Texas will be extra clear with how a lot it spends to quickly home foster kids and with what its non-public contractors are spending to supply foster care companies for half of the state, a brand new state report exhibits.
The state’s Legislative Funds Board mentioned in its 2026 Strategic Fiscal Evaluate that the Texas Division of Household and Protecting Companies may shore up monetary reporting in these two areas and didn’t point out the company was misspending state {dollars}. With out detailed expenditure info, it makes it harder for lawmakers to evaluate whether or not the spending is justified, the LBB indicated.
How effectively Texas’ foster care privatization efforts are going — practically a decade after it began — is anticipated to be a serious lawmaker focus subsequent yr, particularly after the state fired its largest foster care contractor this summer season and as attorneys for the state work to persuade a federal choose to dismiss a 15-year lawsuit that has compelled the state to spend a whole bunch of hundreds of thousands of {dollars} to repair foster care circumstances.
“In our conversations with foster and adoptive mother and father throughout Texas, we persistently hear issues about transparency and oversight of child-placing businesses’ spending and practices,” North Texas advocacy group Constructing Future Households, which assists foster and adoptive mother and father, mentioned in an announcement in regards to the LBB’s findings.
The state has labored to scale back the variety of kids with out rapid placements by discovering extra foster houses. Whereas the variety of kids with out an instantaneous foster residence has gone down dramatically — from about 90 an evening in 2022 to lower than 15 an evening this yr — prices to quickly home them are nonetheless appreciable. Every time the state should place a foster baby in short-term housing, it not solely pays for the lodging, similar to a resort room, however additional time for the workers to stick with the kid, safety and a nurse to manage remedy. There’s additionally meals, workers journey and short-term contracts, generally with psychiatric hospitals.
“Though the common day by day inhabitants of Youngsters With out Placement (CWOP) has decreased considerably since fiscal yr 2022, the related prices to supervise CWOP stay vital,” the report said. “DFPS at the moment has no common reporting enough to supply an understanding of how related prices relate to the variety of kids in CWOP.”
Since 2022, short-term placements for youngsters have price about $150 million in complete with solely $35.6 million of that coming from the federal authorities and the remaining from Texas coffers. The Legislature has additionally spent one other $146.7 million on emergency placement housing efforts, the report mentioned.
Then there’s a whole bunch of hundreds of thousands of {dollars} being spent on non-public foster care contractors, since 2017, when the state first started shifting foster care placement and baby administration roles from DFPS to personal corporations often known as Single-Supply Continuum Contractors, or SSCCs.
The unique laws that created SSCCs didn’t require them to report their expenditures.
“This lack of reporting has made it troublesome for the Legislature to know the way SSCCs are expending funds,” the LBB’s report said.
The state studies the price of the contracts it has with its SSCCs. As of November 2025, DFPS reported the mixed worth of its 5 massive multi-year SSCC contracts is $1.34 billion, the report said.
The state assigns every SSCC to a multi-county area below a mannequin that’s designed to maintain abused kids who enter the foster care system nearer to their faculties and household. SSCCs present houses for youngsters, present them companies and help organic mother and father to enhance circumstances of their residence to allow them to regain custody of their kids. At the moment, somewhat greater than 50% of the state’s foster care kids are managed and positioned by these contractors.
The state’s gradual transfer to personal contractors has include blended outcomes. DFPS, together with the state’s different well being businesses, are below once-in-a-decade Sundown critiques, which is able to possible carry heavy legislative deal with the company’s foster care privatization mannequin and the way contractors are performing. Earlier this yr, DFPS terminated the contract of its largest contractor to this point, EMPOWER, which served Dallas and eight different counties, after two kids died in a two-year span below the contractor’s watch. Two contractors now serve the area.
The Texas Alliance for Youngster and Household Companies, which represents non-public foster care contractors, didn’t return requires touch upon the report.
DFPS spokesperson Marissa Gonzales advised the Tribune that the company is finding out the report.
“We’re reviewing it and don’t have something so as to add at the moment,” she mentioned.
For years, advocacy group Constructing Future Households has requested lawmakers to create an ombudsman workplace to deal with complaints when both the state or contractors fail to supply help to households. It believes the Legislature wants to determine one when it convenes in January.
At the moment, the Texas Well being and Human Companies Fee has an ombudsman workplace for complaints made by foster kids.
“Households deserve an unbiased advocate with the facility to show their issues into motion and maintain businesses accountable,” the group mentioned.
This text first appeared on The Texas Tribune.
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